Transaction types of large retailers and policy directions

Jinkook Lee

No 105, KDI Focus from Korea Development Institute (KDI)

Abstract: In their transaction with retailers, suppliers tend to earn less as the share of purchases under special contract grows. This is due not only to the high sales fees (commission) and frequent unfair practices but also, more fundamentally, to the blatant imbalance in bargaining power. When investigating into unfair trade practices in the retail sector, the government should pay closer attention to how such violations are tied to the type of transaction. It should also work to enhance the negotiation power of suppliers by, for example, diversifying retail channels and strengthening suppliers' rights to adjust payments. Indeed, ensuring equal bargaining power can contribute to expanding direct purchases and fairness in retail transactions.

Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:kdifoc:105

DOI: 10.22740/kdi.focus.e.2021.105

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